18 August 2012

Kenya: Ministry Proposes Law Change to Privatise KPA

The ministry of transport has heightened efforts towards privatisation of the Kenya Ports Authority seeking to make it more commercially viable in the market. The ministry, through a Sessional Paper is proposing amendment of the KPA act to expand the authority's mandate to development and management of inland ports.

KPA Act currently empowers KPA to run seaports along the Kenyan coastline and does not provide adequate provisions to enable it operate commercially and respond to the dynamic market demands. The existing act has no appropriate provisions to encourage privatisation of the port services.Though this proposal has been fronted before, it was met with opposition from various quarters.

"Review the KPA act with a view to enacting legislation which will enable the authority to operate more commercially and independently and further facilitate the transformation of the of the port to landlord status," read the paper on Integrated national transport policy presented to a parliamentary committee on Wednesday.

Among the major problems that have recently faced the main port of Mombasa has been congestion due to the increase in trade activities in the region and inadequate road and rail services to help goods flow out of the port. But port workers have been opposed to privatisation with fears of job losses if a private party gets to run it.

"The act then needs to be reviewed and harmonised with the other related acts like the state corporations act so as to provide corporate flexibility to cope with the changes in the maritime transport scene," the Sessional paper read. The paper said the ministry is also working on changes in the Kenya Maritime Authority and the Kenya National Shipping Line.

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